I would call that a good return: I'm surprised it's achievable.Says "excluding the value of the land".
I target a 20% return on my investment in growing the crop, if you see what I mean. That would be with a rent, mortgage, or rental equivalent to take into account the land.
I would call that a good return: I'm surprised it's achievable.
But you would get the SFP if you left it in grass and sold it off field, doing absolutely nothing. So you surely can't count that as part of the return. Why bother growing the wheat? If you left it in grass and sold it for £70ac with the buyer paying for fert if they require it, you have made £170ac for zero outlay and no work. Zero depreciation or risk on machines etc.Ok, so consider:
With a rent and the cost of doing the work, a crop of wheat with decent BG program is about £500/ac to grow. If I grow 3.5t/ac at that, having replaced my P&K, then at todays prices I trouser that £500 and a little more. Add SFP and thats £100 profit on £500 invested, or 20%.
This *has* to happen, as that still means that to earn the same as a driver for Southern Trains (£70k) I need to farm 700ac of land and risk the weather ruining it all. It appears a Southern Trains driver can earn that while either striking or being late. So a 20% return sounds great, until you realise that on a rented farm of 250ac you are really just standing still while unionised / public sector employees are earning piles for working sub-40 hours a week whist getting sick pay, and being able tor retire at 65 on a big pension.
If you are on an AHA rent of £60 which includes a house and still growing a 3.5t/ac wheat crop then you could be making 30%+ return on tenants capital.
Pathetically low....machinery is overpriced and takes the p!ssis the return on capital invested in machinery and working capital very low ?
But you would get the SFP if you left it in grass and sold it off field, doing absolutely nothing. So you surely can't count that as part of the return. Why bother growing the wheat? If you left it in grass and sold it for £70ac with the buyer paying for fert if they require it, you have made £170ac for zero outlay and no work. Zero depreciation or risk on machines etc.